In Kansas, since the late 1990s, our state has repeatedly been forced to focus on courts rather than classrooms or on trials rather than tax fairness. In some ways, those of us who have watched the funding saga over the decades, it is like the movie “Groundhog Day.” Although some of the players change, the story continues to repeat itself. Mind you, it is dressed up like a struggle over spending for schools, but it is actually a fight for fairness in property taxes.
A child who was in kindergarten when the Montoy case was filed in the mid-1990s is an adult by now. Montoy was filed on behalf of students in Salina and Dodge school districts. The claim was that Kansas was underfunding its public school system and unfairly burdening taxpayers in many districts. Several serendipities contributed to the outcome of the case. Legislators who claimed that Kansas schools were adequately funded pushed for a study by a Denver contractor to ascertain the actual cost of a suitable public education. When that study reported that Kansas was underfunding its schools substantially, the Legislature did a second study, conducted “in house” by the Legislative Post Audit department, a part of the legislative branch. Same result. Then Kansas courts used the Legislature’s studies when it decided to require the Legislature to increase school funding. The court also found that the existing formula needed to be tweaked to assure that taxation for schools would be fair to all taxpayers.
The Kansas Constitution, unlike the federal one, has an article that specifically governs public education. Article VI, as passed by the Legislature in 1966 and ratified by the people of Kansas, specifically requires the Kansas Legislature in Section 1 to “provide for intellectual, educational, vocational and scientific improvement by establishing and maintaining public schools.” In Section 6, the Legislature is given the constitutional duty to “make suitable provision for finance of the educational interests of the state.”
Article VI was written by an 11-member citizen advisory committee that was tasked by the Legislature with examining the Kansas education system and recommending changes in its structure and organization. The committee was asked to find a way that the state could provide equitably for every child, taking into account unique pupils and school districts. Seeking to provide for the governance of the educational system as it moved into the future, the committee recommended a comprehensive system with general supervision of public schools by an elected state board and local control vested in locally elected school boards. The committee also provided for the continued governance by the Legislature through the provision of finance.
From 1966 until 1992, the Legislature defined the budget authority for school districts. Laws were passed which set standards and defined curriculum but funding came almost exclusively from local property taxes. Just prior to the new formula adopted in 1991, I was a member of the Leavenworth Board of Education and my memory is that our school district was levying more than 80 mills for schools. In fact, across the state, mill rates varied from nine mills in the Burlington school district to 98 mills in Parsons. That inequity in tax burden was caused by the relative “wealth” of school districts – essentially the value of taxable property and number of school children. Burlington benefits from the taxes raised by the Wolf Creek Nuclear Facility. These days, Burlington school district can raise about 10 times as much for each student in their schools as Leavenworth can by local mill levy. In other words, without some sort of assistance from the state, Leavenworth taxpayers would be carrying 10 times the tax burden as Burlington taxpayers for the same public schools.
Since the Kansas school finance law was rewritten in 1992, state income and sales taxes have funded about 70 percent of school budgets. Prior to that time, funds came primarily from local property taxes. Districts like ours with a lower assessed valuation per pupil receive more state funding than districts with more taxable wealth. In other words, we benefit when the state Legislature does its constitutional duty and provides suitable state funding. Some school districts receive no state funding because their levy raises enough to fund their schools. Examples include Blue Valley, which benefits from Sprint headquarters, and rural areas with oil and gas wealth.
Unlike city and county governing bodies, school districts are not empowered to levy their own taxes or spend beyond the budget authority defined in state law. Every school district, except Fort Leavenworth, levies 20 mills for schools. The state’s duty is to collect from the districts like Burlington, that raise more than they are entitled to spend, and distribute state funds to those like the districts in Leavenworth County, districts that cannot be funded by the 20 mill levy. One mill is one dollar per $1,000 dollars of assessed value. The property tax you pay consists of a local portion which is used to fund area services and a statewide portion which is used to fund public schools.
In 1992, the statewide mill levy was set at 35 mills. In 1996, the Legislature and governor reduced the statewide school mill levy from 35 mills to the 20 mills currently assessed. That action was pushed by the legislators who represent districts with high assessed valuation per pupil. Why? Well, if you can levy a local property tax on Sprint just for Blue Valley schools instead of the entire state taxing that entity for all public schools, the tax burden for those who live in southern Johnson County will decrease. Unfortunately, if school districts like Leavenworth want to buy the same school product (teachers, class size, building quality, technology, etc.) your property taxes must be three times the level of theirs.
To simplify, you and a friend from Overland Park are standing in line to buy milk. You are charged $3 and he only pays $1. In the school finance debate, he might say you don’t value your milk (public schools) as much because you complain about the inequity of the milk price. I would counter that we know how much the milk (public education) costs and the formula that guarantees a fair (price) tax burden along with quality milk (a suitable education for every child) is the ultimate goal during the 2018 legislative session.
Let’s hope the majority of our Kansas Legislature cares about doing the right thing for taxpayers statewide.
Marti Crow is a Leavenworth Times columnist.